How to re-engineer the world

PHYSICS is the study of matter. Its modern counterpart could be called “social physics”, argues Alex Pentland of the Massachusetts Institute of Technology. The invention of the microscope and the telescope let scientists unlock the mysteries of the universe. The new abundance of data in society—GPS co-ordinates, credit-card transactions and phone records, which he calls “digital breadcrumbs”—allow people to improve their knowledge of how humans interact and how ideas come to spread.

By cleverly processing such “big data”, it is possible to identify patterns of behaviour, just as scientists once worked out the laws of the physical world. Understanding social physics, he asserts, lets people “tune” social networks and obtain the results they want, just as radio engineers can tune a receiver to a desired frequency. This allows certain aspects of human life—from how companies operate to how cities work—to be “re-engineered” to make them more efficient.

These are grand claims. Mr Pentland, a pioneer in adding data-driven methods to the social sciences, backs them up with numerous examples from his research. For example, by controlling the spread of ideas, he improved the performance of a group of currency traders. In 2011 he analysed around 10m transactions from 1.6m users of eToro, a financial-trading site that lets people communicate and copy other people’s trades. He found that traders who were isolated from others or over-connected did worse than those who struck a balance. The former group was deprived of information and the latter became stuck in an echo chamber. By using subtle incentives to get the loners to interact more and the social butterflies to reduce their information intake, he was able to double the profitability of the group.

“Social Physics” is filled with rich findings about what makes people tick. Using millions of data points measured over a long period of time in real settings, which Mr Pentland calls “living laboratories”, the author has monitored human behaviour on an unprecedented scale. Through it, for example, he has discovered that people change how they behave in measurable ways when they fall ill. By tracking mobility and call patterns, researchers were able to tell that someone was coming down with flu before they knew it themselves.

In another case, the group tapped a wealth of mobile-phone data from Côte d’Ivoire to track where commuters began and ended their journeys on public transport. The researchers discovered that with a minor tweak to the system, the average commuting time in Abidjan, the largest city, could be reduced by 10%.

Often the examples underscore the importance of social ties. One study in the Swiss town of Poschiavo found that local householders were more likely to use energy-saving schemes if they offered gift points to the householders’ neighbours instead of to the householders themselves.

From studies such as this Mr Pentland believes that a larger truth emerges. Economic and political systems, based on individual action and rational choice, overlook the influence of social ties. Institutions should be redesigned around social physics, he says. For instance, to improve health-care, anonymous medical records could be used to show what treatments work best. Mr Pentland’s research also offers lessons for policymakers and business people. He advances a new way to protect privacy by creating something of a property right for personal information. People would in most cases control what personal data were collected, how they are used, and with whom they are shared, treating their personal data as assets, as they do money in a bank.

Yet he is less convincing when he strays from his research to make broader points about politics and economics. He reduces too much of the world’s complexity to something to be solved by data, when they are just part of the solution. His enthusiasm for a world run by datacrats rings of a zealotry that could easily go awry. Still, “Social Physics” is a fascinating look at a new field by one of its principal geeks.